Which form of business organisation is owned by shareholders but managed by directors elected by them?
Correct answer: B. Joint stock company
- A. Sole proprietorship
- B. Joint stock company
- C. Ordinary partnership
- D. Cooperative partnership
Explanation
Shareholders own the company, while the board of directors provides overall direction and supervision. A sole proprietorship and an ordinary partnership are generally managed directly by their owners or partners.
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About Nature and Forms of Business Organisation
Business organisation combines people, capital, materials and entrepreneurship to produce goods or services and earn profit, while also meeting customer and social needs. Coverage includes sole proprietorships, partnerships, companies and cooperatives, with comparisons of ownership, liability, control, profit sharing, continuity and legal status.
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